Indicator 2:

Bank account ownership
in low income households

Trend

vs. Georgia

What does it measure?

This indicator is the percentage of low income families in Chatham County that had a checking or savings account with a minimum balance of $300 at any given time during the past year. Low income households are defined as those where one or two persons work 50 weeks per year or more, combined, and the total household income is less than 250% of the federal poverty income level for a one parent, two child household ($45,308 in 2011).

Why is it important?

Building savings is essential for establishing an emergency reserve of financial assets to mitigate the adverse effects of unexpected financial emergencies such as job loss, health problems or for critical vehicle or home repair expenses. The establishment of a savings asset also provides a basis for long-term asset building for a home, higher education and retirement. Savings are especially important for individuals and families of lower income levels who have fewer assets and are much less likely to have access to credit from financial institutions.

The sum of $300 is the amount typically needed for a single, uncomplicated emergency. It reflects the average loan amount obtained through payday loan services. By maintaining a saving or checking account with $300, families can avoid high-fee check-cashing or payday loan services while enhancing the household’s creditworthiness.

How are we doing?

Among low income households in Chatham County in 2012, 72.7% had a checking or saving account, virtually the same as in 2010 (73.5%). Among those fully employed, however, those with accounts fell to 75.7% from 84.7%. Among those households where individuals were not fully employed, the incidence of bank account ownership increased to 69.6% in 2012 from 63.7% in 2010.

In 2012, 50.4% of low income households in Chatham County were able to maintain a continuous combined balance of $300 in checking and saving accounts, up from 48.1% in 2010. Among fully employed households, 44.3% were able to maintain a balance of $300 in their bank accounts, a decline from 57.3% in 2010. But in households where individuals were not fully employed, the incidence of those who could maintain a balance of $300 increased to 57.1% in 2012 from 40.2% in 2010.

LOW INCOME HOUSEHOLDS WITH A SAVING OR CHECKING ACCOUNT
Source: AASU Public Service Center

LOW INCOME HOUSEHOLDS WITH CONTINUOUS COMBINED BALANCE OF $300 IN SAVING OR CHECKING ACCOUNT
Source: AASU Public Service Center